The Ethereum, Solana and Avalanche networks have never been more active with transactions increasing and costs plummeting. Yet their tokens are collapsing. A troubling divergence that questions… is adoption enough to save courses?
In brief
- Transactions and efficiency are exploding on Ethereum, Solana and Avalanche, with costs divided by 3 to 10.
- Despite their growth, ETH, SOL and AVAX lose more than 50% of their value in one year.
- Token inflation, dilution of staking rewards and competition from Layer 2 are weighing on their prices.
Crypto: Ethereum, Solana and Avalanche break records!
In 2026, the Ethereum, Solana and Avalanche blockchains are running at full capacity and the numbers speak for themselves. Ethereum saw its transactions jump 68% in one year, from 121.1 million to 203.9 million in the second quarter of 2026. Solana and Avalanche follow the same trend, with transaction volumes increasing by two or even ten times, depending on the period. Additionally, transaction fees have collapsed. On Solana, the average cost fell to $0.005, from $0.030 a year earlier. Ethereum cut its fees by three, from $1.08 to $0.31.
This performance is explained by major protocol improvements:
- On Ethereum, the Dencun update reduced Layer 2 costs by optimizing data storage;
- Solana benefited from Firedancer, a high-performance client that boosted its ability to process transactions;
- Avalanche, for its part, relied on subnets to scale its ecosystem.
However, these technical advances have a hidden price: validator revenues are collapsing. Indeed, with falling fees, the rewards in native tokens (ETH, SOL, AVAX) are melting like snow in the sun. As a result, validators earn less, and crypto investors are wondering.
Why are ETH, SOL and AVAX collapsing despite their performance?
Here is the heart of the problem. Record activity does not translate into higher prices. Quite the contrary, Ethereum (ETH) has lost more than 50% of its value since July 2025, while Solana (SOL) and Avalanche (AVAX) have fallen by 53% and 58%, respectively. This dichotomy can be explained by several factors:
Token inflation:
Staking rewards are mainly financed by the issuance of new tokens (93% for Ethereum, more than 90% for Solana). Result, a massive dilution of the value of existing tokens, especially if demand does not follow.
The law of supply and demand:
This law works against these blockchains. Indeed, with an increasing supply of blockspace and stagnant demand, prices are collapsing. As sums it up Kam Benbrikhead of on-chain research at Bitwise:
The networks are running at full capacity… but no one wants to pay for fuel.
Staking becomes a double-edged trap:
With 40.2 million ETH (or a third of the total supply) now staked, rewards are being shared among an increasing number of participants, thereby reducing individual returns. Bitmine, the largest holder of Ethereum, stakes 4.9 million of the 5.8 million ETH it owns, clearly illustrating this trend.
Layer 2 competition:
Indeed, competition from Layer 2s such as Arbitrum, Optimism or Base (Coinbase) captures a growing portion of transactions, depriving Layer 1s of potential revenue.
In the crypto ecosystem, record activity is no longer enough. Without strong demand, Ethereum, Solana and Avalanche tokens collapse. In your opinion, should we focus on long-term adoption or fear lasting collapse? Do you think this divergence between adoption and price is a buying opportunity… or a sign of a market in structural crisis?
Maximize your Tremplin.io experience with our ‘Read to Earn’ program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.
